Pier 1 files for bankruptcy protection amid online challenge
Pier 1 Imports Inc - the oncetrendy supplier of home goods like papasan chairs and throw pillows - filed for bankruptcy protection Monday after years of sliding sales.
The Fort Worth, Texasbased company has been struggling with increased competition from budget-friendly online retailers like Wayfair and Amazon and discount stores like Home Goods. In a 2018 presentation to investors, the company acknowledged that shoppers thought its merchandise was outdated and expensive. It was also burdened by high sourcing and supply chain costs.
Pier 1 said it will pursue a sale, with a March 23 deadline to submit bids. A hearing is scheduled for Tuesday at the US Bankruptcy Court for the Eastern District of Virginia.
In the meantime, Pier 1 said lenders have committed approximately $256 million in debtor-in-possession financing so it can continue its operations during the Chapter 11 proceedings.
“Today’s actions are intended to provide Pier 1 with additional time and financial flexibility as we now work to unlock additional value for our stakeholders through a sale of the company,” Pier 1 CEO and Chief Financial Officer Robert Riesbeck said in a statement. Riesbeck, an executive with previous corporate turnarounds, joined Pier 1 last summer.
Ted Gavin, a retail bankruptcy expert and managing partner of the consulting firm Gavin/Solmonese, said he hasn’t shopped at Pier 1 in more than a decade. (AP)